Rexel USA CEO Roger Little sat down with tED magazine at the end of 2024 to talk about key issues impacting our supply chain. That included the continued use of technology, workforce development, electrification, and mergers and acquisitions.
In the first of this four part series, Little discusses Rexel’s M&A strategy as we begin 2025.
tED magazine: One of the topics that we discussed about six months ago was merger and acquisition activity. Rexel had just acquired Tally, and you had said that you’re going to remain active in the M&A space. Certainly, you’re watching the landscape. Companies are being acquired, and companies are merging on a regular basis. Where are you in that strategy compared to where you were six months ago and what do you see going forward into 2025?
Roger Little, CEO, Rexel USA: One year into being CEO, and we’re definitely seeing increased M&A activity. It did slow a little through mid Q3 into early Q4, but I think that was probably a result of election uncertainty and everything slowed during that time. But we’ve seen, in the last three to four weeks, a lot of activity and a lot of early looks from brokers and bankers. I think it’s going to be a very busy 2025, which is good. We’re excited about that. We’re actively working on it at the moment, and our strategy is no different than when we last spoke. It’s around core electrical distribution and some of the adjacencies that we’re interested in, which is no secret after the Tally acquisition. We’re interested in data, wireless and broadband, so we’ll continue to look at that space. We see real opportunity there, but there’s also opportunity in the automation space. We already have a nice automation business, and will continue to look in that space as well. I think 2025 is going to be a record year for M&A, if I had to predict it.
tED magazine: Don’t get me too close to the to the fire here. I’m not asking for inside secrets or anything like that but at least give me some idea of Rexel’s mindset going forward in mergers and acquisitions in 2025. I’m not asking for specifics. But as a general operating procedure is this something you’re talking about daily? Weekly? Monthly? Have you formed teams? What are some of the things that you’re doing to stay on top of every opportunity that comes our way?
Little: Rexel USA has a long-standing M&A team that reports directly to me. We speak, if not daily, every other day because there have been so many interactions with brokers and bankers happening. We have probably six active opportunities at the moment that we’re working on, and they vary from branch operations in the core electrical space to very large opportunities in the core. Also, adjacencies in automation and something in the wireless datacoms space. There’s just a lot going on. We’ve seen companies like Summit go to market successfully and be acquired by one of our competitors. Acquisitions with that size operation aren’t going to happen every day but I’m sure we’re going to see another 2-4 of those next year. Those take a lot of work, a lot of due diligence when you go through one. It keeps the team busy. We did grow the M&A team. We added two people to that team and if we have to add more, we will definitely do that because we’re going to stay active.
tED magazine: You mentioned data, which has been so hot for the past couple of years. It’s really caught fire last year with the explosion of data center and datacom plus the explosion of mergers and acquisitions that have been going on. Are you finding that as a result you’re constantly moving toward experts in the field?
Little: We need to make sure that we have an expert in datacom. We need to make sure we have an expert in M&A. We want to make sure that they’re married together so we’re going in the right direction. Some of the acquisitions we’ve done lend themselves to helping us get some of that expertise as well. Leveraging Mark Talley from the Talley organization with some of his relationships and knowledge. Leveraging some folks within our organization and then to your point going outside and finding that expert that can help us maneuver through that space is very important and it doesn’t matter if it’s datacom or data centers or if it’s in the automation world. Obviously, I have a background in that space, so I tend to be a little bit of an expert. I certainly don’t know everything about the automation space, so we’ve got a team that helps us in that.
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